Sales Tax Instructions

Sales

SalesTaxInstructions, 2009 registered person, being not exempted under section 13 or being not specified in the 6 th Schedule to the SalesTax Act are chargeable to SalesTax and supply thereof, are taxable supply. The consideration / sale proceeds received against disposal of fixed assets as well as scrap / waste are their income and therefore, it had been taken as income and accounted fro as such in their financial accounts. Such income being a part of business and investing activity done during the course of business is an act of furtherance of business. It is statutory authority under subsection (2) of section 13 of the SalesTax Act, 1990, which vests in the Federal Government the power to exempt any taxable supply made in Pakistan or any goods or class of goods from the whole or any part of the tax chargeable under the said Act, subject to the conditions and limitations so specified. No exemption has since been notified by the Federal Government in relation to the sale, auction or otherwise disposal of goods, moveable fixed assets including plant/machinery equipment having no value addition to the goods and for which the input tax was not allowed. 25. The conclusion of the above discussion is that the fixed assets as have been referred in the cases are goods or taxable goods and comes within the ambit of taxable supply and liable to the levy of sales tax. The High Courts have proceded on the wring premises and have wrongly interpreted the legal provisions and have drawn a wrong conclusion thereto. Resultantly, while accepting these appeals, the judgments impugned herein are set aside it is held that the respondents/ assesses are liable to the levy of tax on the sale of the assets subject-matter of the cases. ******** OFFICE MERMORANDUM C. No.1/1-STB/2006 DATED 23 RD JUNE, 2007 SUBJECT: RATIONALIZATION OF FEDERAL LEVIES ON INTERNATIONAL AIR TRAVEL The undersigned is directed to refer to the subject cited above and to say that the following budgetary measures have been taken in the Budget 2007-08 with regard to the Federal levies on international air travel: (i) Foreign travel tax (FTT) shall be abolished with effect from 1 st July, 2007. The Government Airport (GAT) shall also stand abolished with effect from 1 st July, 2007; (ii) The rates of Federal excise duty (FED) have been notified to include the existing combined incidence of FED, FTT and GAT to be collected as Air Travel Tax (ATT). The new rates of ATT applicable from 1 st July, 2007 are as under: Passengers embarking to or from SAARC region, UAE (Middle East), Saudi Arabia, Africa, Afghanistan Rs. 3200/- for economy and economy plus classes, and Rs. 4200/- for club, business and first classes Passengers embarking to or from Europe, Far East, China, USA, Canada, Rs. 4200/- for economy and economy plus classes, and Rs. 5700/- for club,

SalesTaxInstructions, 2009 Australia, South America, others business and first classes. (iii) The exemption of excise duty on passengers coming from abroad shall stand withdrawn. However, appropriate time shall be given to implement the measure worldwide through IATA. 3. Civil Aviation Authority is requested to approach IATA and all the concerned airlines to ensure that the levy of Air Travel Tax (ATT) for passengers coming from abroad is implemented all over the world as soon as possible. As regards the passengers who originate their journey from Pakistan, the new rates of ATT shall be applicable with effect from 1 st July, 2007. The collection under ATT shall be deposited by the airlines with CBR on monthly basis. Detailed procedure of collection and deposit of excise duty is being notified. [Issued by the CBR, Islamabad, under the signature of Mr. Wajid Ali, Secretary (ST&FE- Budget), addressed to the Director General, Civil Aviation Authority (CAA), JIAP, Karachi and copy endorsed to Mr. Iftikhar Qutab, Collector (Enforcement), LTU, Karachi, Mr. Muhammad Younas, Deputy Secretary (BR-II), Ministry of Finance, Islamabad, Mr. Kamran Hassan, Chairman, Board of Airlines Representatives in Pakistan (BARIP), Mr. Agha A. Shahi, Deputy General Manager, Agency Affairs, PIA. PIA Head Office, Karachi, Mr. Azhar Hashim, Sales Manager, Air France, 4 th Floor, The Forum, Clifton, Karachi, Mr. Adnan Kazim, Vice President, Emirates Airline, Karachi & Mr. Khurshid Ahmad, Acting Director, Coordination, Civil Aviation Authority, Karachi. ******** C. No. 1/2-STB/2006 DATED 27 TH JUNE, 2007 SUBJECT: CLARIFICATION REGARDING SRO 1020(I)/2006 DATED 02.10.2006 I am directed to refer to the subject cited above and to say that the Board has been approached for clarification as to what constitutes a personal computer for the purpose of SRO 1020(I)/2006 dated 02.10.2006 whereby minimum assessable values for sales tax purposes have been fixed for computers and monitors thereof. It is clarified that for the purpose of sales tax assessment, a PC includes a central processing unit (CPU), a monitor, a keyboard and a mouse. The said criteria shall, however, be applicable only for sales tax assessment. [Issued by the CBR, Islamabad, under the signature of Mr. Wajid Ali, Secretary (ST&FE- Budget), addressed to the Collector of Customs, Model Customs Collectorate, Appraisement/Preventive/ Port Qasim, Karachi, the Collector of Customs, Lahore/ Sambrial (Sialkot)/ Faisalabad/Rawalpindi/Peshawar & the Collector, Collectorate of Customs, SalesTax & Federal Excise, Hyderabad/ Quetta/ Multan.] ********